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Archive for the ‘Economics’ Category

It is time to end the physical, emotional, and financial destruction caused by the lockdown.

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With the ongoing shutdown we are getting way out there onto dangerously thin ice. Image courtesy of Adobe Stock.

We are past the point where the damage caused by the lockdown is greater than the damage caused by the coronavirus.  The damage could start compounding.  Here are just a few of the recent articles making this point:

4/22/20 – The Hill – The data is in – stop the panic and end the total isolation – A medical doctor says it is time for our leaders to examine the evidence instead of hypothetical guesses and then carefully let the country start operating again. He cites five factors ignored by people who want to keep the country in ongoing lockdown:

Fact 1: The overwhelming majority of people do not have any significant risk of dying from COVID-19.

Fact 2: Protecting older, at-risk people eliminates hospital overcrowding.

Fact 3: Vital population immunity is prevented by total isolation policies, prolonging the problem.

Fact 4: People are dying because other medical care is not getting done due to hypothetical projections.

Fact 5: We have a clearly defined population at risk who can be protected with targeted measures.

Keep in mind California will probably be on lockdown until August and Virginia may be locked down until a vaccine is in use.

Two severe medical problems are being caused by and will be prolonged by the severe lockdown.

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Written by Jim Ulvog

April 26, 2020, 16:38 pm at 4:38 pm

Posted in Economics, Other stuff

Good news in some states for people who like to pay their rent and put food on the table. Bad news for California and Virginia.

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A deep freezer, used for keeping large volumes of meat and vegetables frozen. That’s where the economies of California and Virginia are going to be stored for a long time. Image (but not commentary) courtesy of Adobe Stock

Many states are starting to open up their economy.

Virginia may be closed down tight for up to 24 more months.

California may not open up until August.

August.

There will be incalculable medical, emotional, and financial damage in California and Virginia from the lockdown. More on that momentarily.

This discussion will be posted on several of my blogs.

Good news

On the bright side, getting most attention for opening are:

  • Texas
  • Georgia

Other states are thawing because they also don’t want to bankrupt everyone, destroy all the hospitals, further tear down overall health levels, and permanently cripple their economy. List includes:

  • Alaska
  • Colorado
  • Minnesota
  • Montana
  • Mississippi
  • Ohio
  • Oklahoma
  • Pennsylvania
  • South Carolina
  • Tennessee

And then there is Virginia and California.

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Written by Jim Ulvog

April 25, 2020, 15:05 pm at 3:05 pm

More entries on the list of economic sectors devastated by the shutdown.

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Image courtesy of Adobe Stock.

Hat tip to Behind the Black for the legwork identifying additional sectors of the economy that are collapsing. Large segments of the economy I haven’t mentioned before:

  • Home sales
  • Housing construction
  • Apartment rentals
  • Clothing production
  • Flower trade

Damage to these sectors won’t immediately heal the moment state governors decide they will allow the economy to come back to life out of its induced coma.

Home sales

4/21/20 – Fox Business – US home sales plunge 8.5% in March, and it may grow worse – Sales of existing homes dropped 8.5% in March. Article use the word “cratered.”

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Written by Jim Ulvog

April 22, 2020, 6:10 am at 6:10 am

Posted in Economics, Other stuff

Economic news: Surge in new unemployment claims; unemployment rate starting to rise.

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Image courtesy of Adobe Stock.

Another huge jump in new unemployment claims. The rise in count of people without work is barely starting to show in the unemployment rate.

It would be wise to start watching the economic stats more closely than usual.

4/9/20 – CNBC – US weekly jobless claims jump by 6.6 million and we’ve now lost 10% of workforce in three weeks – Another surge in new unemployment claims announced today. Here is a recap:

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Written by Jim Ulvog

April 9, 2020, 13:00 pm at 1:00 pm

Posted in Economics, Other stuff

Economic damage from pandemic is severe and will continue to be severe.

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Image courtesy of Adobe Stock.

We are starting to see some guesses about the economic damage from the shutdowns driven by the pandemic.

When you read about the 10 million people who have filed for unemployment in the last two weeks and consider there will be millions more and the unemployment will continue for another month or two, ponder the ripple effects.

That shock of unemployment translates into cars not purchased, summer & Christmas vacations not taken, conferences not attended, college enrollment delayed a year, fancy wedding receptions never planned, and house renovations postponed by a decade.

4/5/20 – Wall Street Journal – State Shutdowns Have Taken at Least a Quarter of U.S. Economy Offline – Study by Moody’s Analytics estimates that 29% of the U.S. economy has shut down. That is the estimated drop in output we have already seen.

Some of the staggeringly dangerous hits to U.S. output and wealth:

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Written by Jim Ulvog

April 8, 2020, 6:09 am at 6:09 am

Posted in Economics, Pondering

Total cost of Alexander’s rampage

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Tetradrachm from era of Alexander the Great. Image courtesy Adobe Stock.

Tetradrachm from era of Alexander the Great. Image courtesy Adobe Stock.

This will be my final post on the finances of Alexander the Great.

Professor Frank Holt’s book The Treasures of Alexander the Great: How One Man’s Wealth Shaped the World explains the ancient record does not give us enough details to estimate the total expenses paid by Alexander as he rampaged around the world.

The total expenses based on identifiable items in historical narratives is aggregated by the professor in a formula as:

  • 189( X) + 69,176 talents

Read the rest of this entry »

Written by Jim Ulvog

September 1, 2016, 7:00 am at 7:00 am

Posted in Economics, Other stuff

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A few stray tidbits on the cost of Alexander’s military

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Ancient Greek coins. Image courtesy of Adobe Stock.

Ancient Greek coins. Image courtesy of Adobe Stock.

Professor Frank Holt’s book The Treasures of Alexander the Great: How One Man’s Wealth Shaped the World explains there is little in the historical record on the cost or size of Alexander’s military. Here are a few tidbits which are visible.

Navy

Alexander learned to appreciate the value of a Navy. One data point is that in 334 BC he had 200 ships operating in the Aegean sea. No quantification mentioned of naval forces elsewhere at that or any other time.

Army

Figuring out how much Alexander spent to field his military forces is a game of stringing together many wild guesses. The author accumulated his own long string of guesses and assumptions for small units. He also quotes several other studies.

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Written by Jim Ulvog

August 30, 2016, 7:00 am at 7:00 am

Posted in Economics, Other stuff

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Some tidbits on the spending side of Alexander the Great’s reign

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Ancient Greek coin. Alexander the Great and Apollo with the chariot of the sun. Image courtesy of Adobe Stock.

Ancient Greek coin. Alexander the Great and Apollo with the chariot of the sun. Image courtesy of Adobe Stock.

I have been discussing Professor Frank Holt’s book The Treasures of Alexander the Great: How One Man’s Wealth Shaped the World . You can find other posts on the ancient finances tag.

The second half of the book explores Alexander’s spending. There is even less historical information available on his spending than on his looting.

One part caught my eye.

Alexander built about 13 major cities according to the educated guess in the book. That doesn’t include dozens of small villages or all the sundry fortifications.

One of these cities, Ai Khanoum, had three miles of wall, which is guessed to have taken 3,000 workers six months to build.

How much would that construction cost? I will make a wild guess.  Read the rest of this entry »

Written by Jim Ulvog

August 13, 2016, 10:27 am at 10:27 am

Posted in Economics, Other stuff

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The incredible wealth of Mansa Musa, the ancient emperor of Mali

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Image courtesy of DollarPhotoClub.

Map of Mali courtesy of DollarPhotoClub.

Barron’s suggests Mansa Musa, the Emperor of Mali in the 1300s, was the richest man who ever lived.

Since I firmly believe that I am richer today than John D. Rockefeller was back in 1916, I would also insist that I am, right now, richer than Mansa Musa was in 1324. But that isn’t the point of the story. I’ll mention travel costs momentarily.

The 7/23 article from Barron’s gives a glimpse into ancient finances by wondering Who Was the Richest Person Who Ever Lived? / The Emperor of Mali lived on top of a 14th century Goldmine so prolific that it probably made him the richest person who ever lived.

Musa Keita I is referred to as Mansa, or Emperor, Musa. He was born somewhere around 1280 and died somewhere around 1337. He was the ruler of the Mali Empire which stretched across Western Africa.

Consider the economic resources in the area: gold and salt.

Read the rest of this entry »

Written by Jim Ulvog

August 2, 2016, 7:14 am at 7:14 am

Posted in Economics, Other stuff

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Guess on the value of all loot taken by Alexander the Great

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Tetradrachm from Alexander the Great. Image courtesy Adobe Stock.

Tetradrachm from Alexander the Great. Image courtesy Adobe Stock.

My discussion continues of how much wealth Alexander the Great looted while on his rampage around the world. These calculations are based on two books I’ve really enjoyed:

Loot from Persia

Prof Holt provides a couple of ancient estimates of the total haul in Persia. Here is a recap:

  • ?? Babylon
  • 50k talents – Susa
  • 120k – Persepolis
  • 6k – Pasargadae
  • 26k – Ecbatana

That gives a point estimate of 202k talents. Back out some poetic license exaggeration and add an amount at Babylon about equal to Susa (author’s estimate) gives me an estimate of about 225k talents, give or take. That is only the precious metals without art, statuary, spices, clothes, pottery, or gold inlaid stuff.

In addition, Darius fled with maybe 8,000 talents, Alexander paid bonuses of around 12,000 talents to his soldiers, with another 2,000 talents to Thessalain soldiers. There was enough stray coins found a century later to mint 4,000 talents of coins. That is around another 26,000 talents or so of additional bullion. Add in the unquantifiable amount soldiers looted and all the non-bullion treasures means there was an incalculable amount of wealth looted from the Persian empire.

I’ll work with 202K point estimate, plus 50K from Babylon, less 25K for poetic license, plus 26K sundry disposition. That gets to a point estimate of 253K, with my very wild guess of a margin of error of minus 50K to plus 100K.  Let’s work with a 250,000 Talent estimate. That means I’ll roughly estimate Alexander looted 250,000 talents of silver-equivalent from Persia.

Total haul during Alexander’s extended raid around the world

The total haul from looting is estimated by the Prof. Holt as 69( X) + 216,820 talents, where X is an unknown amount from one raid or battle. The total is unknown and unknowable.

Shortly after that estimate the author adds in tribute from conquered areas that were not looted in return for payments and loyalty.

Total proceeds from the wars is then estimated in a formula expressed as 81.67( X) +311,761.

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Written by Jim Ulvog

July 15, 2016, 9:52 am at 9:52 am

An indication of Persian wealth from the book of Esther

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Drawing of Persian daric gold coin. Alexander would have looted tons of these. Image courtesy of Adobe stock.

Drawing of Persian daric gold coin. Alexander would have looted tons of these. Image courtesy of Adobe stock.

The number two man in the Persian Empire offered a bribe of 10,000 talents to the king in return for permission to kill off all the Jews living under the authority of the king. Today’s question: what would the amount of that bribe be worth in today’s money?

The Old Testament book of Esther tells the story of Haman plotting to kill all the Jews living in the Persian Empire.  Esther then told King Xerxes about the plot. The King executed Haman and allowed the Jews to defend themselves from those planning to exterminate them. The Jews survived. Those who expected to slaughter them did not. That is the short version. For the full details, check out the book of Esther.

Hers is a wonderful story of realizing God put you in a place to do a job that only you can do. So many other delightful and encouraging aspects of the story. If you haven’t looked at it lately, check it out.

There is one particular verse in the story which overlaps my discussion of Alexander the Great looting the Persian Empire. Read the rest of this entry »

Written by Jim Ulvog

June 23, 2016, 12:42 pm at 12:42 pm

Posted in Economics, Other stuff

Tagged with

Alexander the Great’s biggest hauls when looting cities

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Drawing of Persian daric gold coin. Alexander would have looted tons of these. Image courtesy of Adobe stock.

Drawing of Persian daric gold coin. Alexander would have looted tons of these (literally tons). Image courtesy of Adobe stock.

After developing a few points of reference for comparing ancient finances to now, I can get back to pondering the value of loot Alexander the Great stole while on his military rampage, I mean campaign.

Following estimates of how much loot Alexander the Great hauled away is from Professor Frank Holt’s book The Treasures of Alexander the Great: How One Man’s Wealth Shaped the World which I previously mentioned. (Can you tell I enjoyed his book?)

I will revise my previous calculation of Alexander’s haul from Susa and then develop a point estimate for the value of proceeds from his biggest sacking.

Approximate value of the haul from looting Susa, the capital of Persia

The loot from Susa is described by Prof. Holt, and converted to a current value, as follows:

  • 40,000 Talents of uncoined bullion, or raw silver
  • 10,000 Talents of gold coins, which I will assume is expressed as the equivalent in silver
  • 50,000 Talents – haul at Susa, estimated by Prof. Holt
  • 400 years wages per talent, for a skilled laborer, adjusted for Great Enrichment at a factor of 40; could be as high as 80 or even 100
  • 20,000,000 years wages
  • 200,000 centuries of wages for an average worker
  • $70,000 – average annual compensation package for a skilled construction worker today, calculated here
  • $1,400,000,000,000 – really rough approximation of current wages today for skilled construction workers which would be vaguely comparable to loot hauled off from Susa
  • $1.4 trillion – point estimate

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Written by Jim Ulvog

June 20, 2016, 7:34 am at 7:34 am

Posted in Economics, Other stuff

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Total wealth held by American households as reference point for ancient finances

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There is a lot of wealth visible in all those homes. Photo courtesy of Adobe Stock.

There is a lot of wealth visible in all those homes. Photo courtesy of Adobe Stock.

Here is another point of reference I’ll use for my discussion of ancient finances. The Wall Street Journal reported on 6/7/16:  Americans’ Total Wealth Hits Record, According to Federal Reserve Report.

Want to add this additional frame of reference before getting back to looking at Alexander’s haul as he looted various Persian cities.

The Fed released an estimate of the total wealth of all Americans for the first quarter 2016, which includes individuals and nonprofits.

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Written by Jim Ulvog

June 17, 2016, 10:03 am at 10:03 am

Posted in Economics, Pondering

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Stock market capitalization as reference point for ancient finances

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Street sign for Wall Street and Broad Street, the heart of the Financial District of New York City. Image courtesy of Adobe Stock.

Street sign for Wall Street and Broad Street, the heart of the Financial District of New York City. Image courtesy of Adobe Stock.

I am building some reference points for my ongoing learning about ancient finances. (If you couldn’t tell, I’m have a lot of fun. This learnin’ thing is cool.)

Here is the value of all the stock listed on the market in the G-20 economies. This is the total capitalization of the companies in those countries.

Data is from this site. A lot of other sources could be used and other years might give different results. The accuracy of the valuation of Alexander’s loot is only accurate to one or two significant digits. The needed estimates and assumptions will leave any comparisons accurate to only one significant digit. Actually, by the time my calculations are finished, the amounts will probably be accurate to maybe overestimating 20% or perhaps underestimating by 100% or 200%.

Thus, more precision in the market capitalizations is irrelevant.

Amounts are in US dollars and are for 2012: Read the rest of this entry »

Written by Jim Ulvog

June 16, 2016, 11:11 am at 11:11 am

Posted in Economics, Other stuff

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Are you richer today than John D. Rockefeller was in 1916? The answer is, um, yes.

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Would you trade your place in life today for life occupying the Gould-Guggenheim mansion when it was completed in 1912? Even if a billion dollars was tossed into the trade? Photo by Adobe Stock.

Would you trade your place in life today for life occupying the Gould-Guggenheim mansion when it was completed in 1912? Even if a billion dollars was tossed in to sweeten the swap? I would not make the trade.  Photo by Adobe Stock.

I suggest you are in fact richer today than John Rockefeller was 100 years ago. If it were possible for Prof. Don Boudreaux to switch places with John Rockefeller’s life and even if he could have a billion dollars after he arrived back in 1916, he would not make the switch. He would rather live as a comfortable professor today than be a billionaire 100 years ago.

I agree.

Here are three posts to explain this strange idea: first, what life was like 100 years ago, why Prof Boudreaux would not make the switch, and then why Coyote Blog wouldn’t either.

(This post may seem to be out-of-place on my blog discussing accounting and auditing topics. This discussion is part of my enjoyable research on ancient finances and a related thread of how much life has improved over the last 200 years. Since I discuss finance at this blog, it actually fits.)

An article in The Atlantic on 2/11/16 describes America in 1915: Long Hours, Crowded Houses, Death by Trolley. The article is drawn from a report by the Bureau of Labor Statistics: The life of American workers in 1915If you enjoy this brief discussion, I heartily recommend you read the full BLS report. It is a fun read, but then, I am an accountant.

I will update a few of the stats in the Atlantic article where the author took a shortcut. When I browsed through the BLS report, I noticed some sentences which were repeated nearly verbatim in the article, which is okay since the report is a public document.

A few highlights:

Workers in factories averaged 55 hours a week. The fatality rate across the economy was 61 deaths per 100,000 compared to about 3.3 per 100,000 today.

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Written by Jim Ulvog

June 9, 2016, 8:11 am at 8:11 am

Posted in Economics, Pondering

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